Case Decisions From Around the Country

The Pennsylvania Supreme Court recently issued an order allowing a decision to stand in an emotional distress claim. According to the Pennsylvania Defense Institute, the high court ruled that an uninjured bystander who witnesses an accident is not required to have physical impact in order to make a liability claim alleging emotional distress as a result of the incident. The court ruled that any physical manifestation of witnessing the accident, like stress or headaches is enough to make a liability claim.

The decision arose from the case of Lipsky v. State Farm, in which uninjured family members of a man killed by a State Farm-insured drunken driver filed liability claims with State Farm as a result of the emotional distress they sustained when they witnessed the accident.

Landlords are on notice after a ruling by the Ohio Supreme Court last week. The high court ruled that landlords owe the same duty of safety to guests as they do for tenants.

In Mann v. Northgate Apartments, a 16 year old teen was injured when she visited a friend who was a tenant of the Northgate Apartment Complex.

On June 15, 2007, at approximately 11:00PM Mann left her friend’s apartment and walked down two flights of stairs. The hallway where the stairs were located was dark, according to Mann. On the last step of her descent she fell through a glass panel next to the glass exit door. Due to the injuries she sustained, she filed suit against Northgate alleging the building owner failed to maintain adequate lighting for safe ingress and egress to the premises, thereby creating a danger to residents and guests.

Northgate filed a motion for summary judgment and denied Mann’s allegations citing that the darkness was an open and obvious danger and it owed no duty to an invitee for its care of the property.

Mann cited the state’s Landlord-Tenant Act which requires landlords to make all necessary repairs and to maintain the property in a fit and habitable condition. The trial court granted Northgate’s summary judgment motion and Mann appealed. The Appeals court sided with Mann and the case was remanded to the trial court.

A recent California Court of Appeals ruling held that an additional insured’s reasonable expectations of coverage is just as important as the insured’s, in determining whether an additional insured is entitled to a defense under an excess or umbrella insurance policy.

In Transport Insurance Company v. Superior Court of Los Angeles County, environmental property damage claims were made against Vulcan Materials Company. An additional insured, R.R. Street, was also named in the suit. The primary liability insurance policy was underwritten by National Union Insurance Company. That insurer defended R.R. Street. Transport, the excess insurer, filed a declaratory relief action regarding the defense of the additional insured, R.R. Street.

The language within the Transport policy at issue dealt with the meaning of “underlying insurance”. The policy read:

“(1) With respect to any personal injury, property damage or advertising injury

not within the terms of the coverage of underlying insurance but within the terms of coverage of this insurance; or

“(2) If limits of liability of the underlying insurance are exhausted because of

personal injury, property damage or advertising injury during the period of this

policy “The Company will “(a) have the right and duty to defend any suit against the insured seeking damages on account of such personal injury, property damage or advertising injury, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient; but the Company shall not be obligated to pay any claim or judgment or to defend any suit after the Company’s limit of liability has been exhausted by payment of judgments or settlements.”

The court ruled that because the term “underlying insurance” was a generic one, it created an ambiguity and as such, policy ambiguities are resolved in favor of the reasonable expectations of the insured.